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New Jersey Hurricane Insurance: Fact File

AUGUST 2016

New Jersey was one of over a dozen states impacted by Hurricane Sandy in October 2012. Sandy caused $18.75 billion in U.S. insured property losses, excluding flood insurance claims covered by the federal flood insurance program, according to estimates from ISO’s PCS unit. This would make Sandy the third most costly U.S. hurricane, after hurricanes Katrina and Andrew.

Private insurance losses in New Jersey from Sandy totaled $6.3 billion, second only to New York’s $9.6 billion, according to ISO.

New Jersey was one of 14 states impacted by Hurricane Irene in August, 2011. Irene impacted a total of 14 states, causing a total of $4.3 billion in insured property damage, not including flood losses covered under the National Flood Insurance Program (NFIP), according to ISO. The NFIP puts its claims payouts from Irene at $1.3 billion (in all states).

Two of the costliest hurricanes to hit the U.S., based on insured property losses, caused damage in New Jersey: Hurricane Ivan in 2004 and Hurricane Sandy in 2012. (See chart below.)

There were 233,780 flood insurance policies in New Jersey in 2015. Standard homeowners policies typically do not cover flood damage. Flood insurance is covered by the National Flood Insurance Program.

The insured value of properties in coastal areas of New Jersey totaled $713.9 billion in 2013, according to an analysis by AIR Worldwide, accounting for 34 percent of the state’s total insured property exposure.

New Jersey’s market of last resort, the New Jersey Insurance Underwriting Association (NJIUA) was created by the legislature in 1968. Exposure to loss under the plan was $2.3 billion in 2015, compared with $3.4 billion in 1990. NJIUA’s total policies (habitational and commercial) amounted to 16,242 in 2015, compared to 54,878 in 1990.

Top 10 Writers Of Commercial Insurance In New Jersey By Direct Premiums Written, 2015 (1)

(1) Includes residential and commercial Gulf and East Coast properties, as of December 31, 2012. Ranked by value of total insured coastal property.
(2) Total exposure is an estimate of the actual total value of all property in the state that is insured or can be insured, including the full replacement value of structures and their contents, additional living expenses and the time value of business interruption coverage.